Building societies have been told working towards the FSA's treating customers fairly principles will count for little if they can not assess how effective any changes have been.
Clive Briault, FSA managing director of retail markets, says if firms are serious about adopting TCF, they will find a way to measure how successful they’ve been.
Speaking at the Building Society Association (BSA) annual conference, Briault also says firms must ensure they deliver a good post-sale service if they want to be considered by the regulator as good operators.
Briault says he has been encouraged by the attitude of companies in embracing TCF, but warns some firms could be missing a vital point.
He says: “A few months ago, a chief executive of a major retail group explained to me in encouraging details how his firm was putting its customers at the top of the firm’s agenda. But when I asked how the firm measured the success of this initiative there was a long silence.
“I take the view that if something really matters to a firm then it will find a way to measure it, and will report this information regularly to senior management and the board.”
In its latest overview of progress in TCF, the regulator looked at all firms at the end of March to see how the implementation of the principles is progressing.
Large and medium-sized firms both came off well but small firms, and particularly small mortgage firms, performed poorly.
Briault urged senior management in particular to understand how TCF requirements should apply in practice, particularly in measuring the impact changes are having.
He says firms need to look at their relationships with product producers and distributors, paying particular attention to how many consumers are suitable for new products.
He also says societies should select appropriate distribution channels and ensure they provide appropriate information to distributors and consumers.
Finally, he says the FSA expects firms to deliver an effective post-sales service.
“It is important consumers do not face unreasonable post-sale barriers imposed by firms to change product, switch provider, submit a claim, or make a complaint,” he says.
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